CGG lifts leverage ratio caps, amends loans; €350 million capital eyed

By Susanna Moon

Chicago, Jan. 11 – CGG SA said it revised thresholds for its leverage covenant, subject to a €350 million capital increase.

The maximum leverage ratio would be increased to a ratio of 5 times for each rolling 12-month period ending in 2016, to 4.75 times for the rolling period ending in March 2017, to 4.25 times for the rolling period ending in June 2017, to 4 times for the rolling period ending in September 2017, to 3.5 times for the rolling period ending in December 2017, to 3.25 times for the rolling period ending in March 2018 and to 3 times after that.

CGG also agreed to a minimum liquidity covenant under negotiations with its main lenders, according to a company news release.

For the French and U.S. revolving credit facilities, the group must maintain a minimum group liquidity of $175 million at the end of each quarter. For the company’s Nordic facility, the group must maintain a minimum liquidity of $100 million at all times.

The company said it also secured an amendment of its $325 million revolving facility agreement with its French lenders, subject to closing of the €350 million capital increase.

The new scheduling of the total commitments of the lenders would be $325 million up to July 2016; $300 million up to July 2017, up from $275 million; and $275 million up to June 2018.

The extension of the maturity of the French revolver completes the fourth quarter of 2015 refinancing plan, with the execution of a secured 2019 term loan in December to replace 94% of the outstanding 2017 high-yield bonds and 100% of the Fugro vendor loan, the company said.

CGG said it estimates year-end 2015 net debt to be about $2,502,000,000, compared with $2,538,000,000 at the end of September.

Meanwhile, the group’s liquidity was about $420 million at the end of December, compared with $440 million at the end of September.

CGG is a Paris-based manufacturer of seismic equipment and a provider of geoscience services.

© 2015 Prospect News.
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